Probably the easiest way would be to add a custom trait for your faction, then go through all the items that you want to restrict and add a prereq tag with the RestrictedAbilityBonusOption type and your trait as the attribute (see archery tech and how it is excluded from no range weapon for an example).  Then add your chitin armor requiring that same trait. Takes a bit of work, but no modding of the tech tree needed.

I had thought about a custom trait.  Indeed, I have a number of custom items that have a trait associated with them to prevent other races from being able to use them.  But having to add a trait to all weapons and armor in the game is only slightly less onerous than creating a custom tech tree.

OTOH: Heaven, I was impressed with what you were able to do in Stormworld with just traits and no custom tech trees. 

The other side of this is, I don't want my faction able to produce those items either as I don't want to be able to create trained units with those items nor do I want them showing up in my shops.  I suppose custom traits will prevent that as well.

Items can only be limited by unit level for heroes if they are in his backpack.

Edit: We have a request in here: ´https://forums.elementalgame.com/433089/get;3242322 to expand this, go bump it if you support it.